SB 792

Subject to a number of limitations and conditions, this bill creates a refundable

individual income tax credit of 10 percent of the amount spent by the claimant on

qualified rehabilitation expenditures on a construction or reconstruction project on

eligible housing. Under the bill, eligible housing is defined as a single-family

residence that is the claimant's primary residence, provided that the initial

construction of the residence was completed before 1980 and the fair market value

of the residence is equal to or less than the median price of a single-family residence

located in the same county.

The maximum credit amount is $15,000 per claimant, which is 10 percent of up

to $150,000 spent on qualified rehabilitation expenditures. If a married couple files

a joint return, only one spouse may claim the credit. If the eligible housing is owned

by two or more individuals who are not married and do not have equal ownership,

the credit may be claimed based on the individual who incurs costs and the

ownership interest. For a project benefitting one owner, the credit may be claimed

by that individual based on qualified rehabilitation expenditures incurred

individually or, for projects benefitting two or more owners, the credit may be claimed

by each owner in proportion to the individual's ownership interest. A claimant may

not file a claim for the credit until the project is complete, which is evidenced by the

claimant providing information to the Department of Revenue demonstrating that

all permits required by the state or local governments have been issued and all

building inspections related to the project have been completed and approved by a

state or local building inspector. In addition, the bill requires that the basis of the

eligible housing be reduced by the amount of the credit received, and a claimant may

not claim qualified rehabilitation expenditures under this credit if the claimant used

those same expenditures to claim the supplement to the federal historic

rehabilitation credit or the state historic rehabilitation credit. Because the credit is

refundable, if the amount of the credit for which the individual is eligible exceeds his

or her tax liability, the difference will be refunded to the claimant.